The Wonders And Horrors Of Compounding
Title:
The Wonders And Horrors Of Compounding
Word Count:
1665
Summary:
Google Price Target: $16,578.90
Some of you will immediately recognize this headline is a joke. For the rest of you, I was kin
If you´re reading this because you´re interested in what I have to say about Google (GOOG), yo
Warren Buffett´s annua...
Keywords:
compound growth, Warren Buffett, Buffett, Berkshire Hathaway, Berkshire, value investing, inve
Article Body:
Google Price Target: $16,578.90
Some of you will immediately recognize this headline is a joke. For the rest of you, I was kin
If you´re reading this because you´re interested in what I have to say about Google (GOOG), yo
Warren Buffett´s annual letter to shareholders was released on Saturday. For now, I´m just goi
ˆBetween December 31, 1899 and December 31, 1999, to give a really long-term example, the Dow
I knew what Warren was up to, and had some idea of the historical growth rate for the Dow, so
ˆHere´s the answer to the question posted at the beginning of this section: To get very specif
I wish I could tell you that my guess was close. But, it wasn´t even in the right ballpark. Th
The rallying cry of the bubble years would have been Dow 20,000. And what of Dow 10,000? The i
Over a century, that extra 0.7% really adds up. I recently wrote an email to a member of my fa
If you want to have more money than you will ever need, your best bet is to find a few places
It´s time to discuss Google. I have a price target of $16,578.90 on Google. Does that sound re
Don´t answer. First, we need to see what it would take for Google´s share price to reach $16,5
Who would want stock options in an average business? Let´s pretend no one would. Since there’s
As a public company, Google has earned an above average return on equity. It hasn´t been an ea
In my model, Google can literally conquer the world.
With something like $9 billion in equity to start with, a 12% return on equity, and the reinve
Don´t believe me? I know a 12% return on equity looks ridiculously low, but watch what happens
I mean profits! At a P/E of 15, Google would have a market cap of $4.68 trillion. Yes, with a
So, what´s the catch? There are two problems with this scenario. One, in 2056, it´s more likel
The second problem is much less amusing. You see, if on Monday, you were to shell out the $378
Google would have a $4.68 trillion empire, and you´d have an annual return of 7.85% - how can
Time turns molehills into mountains and mountains into molehills. In the very long-term, growt
However, it´s probably a smaller part than you think. Right now, Google is trading at about tw
Think of it this way. At $31.87 a share, 85% of your purchase price would be backed by cold, h
Return on equity is the puppet master here. Take another look at the numbers. They´re doing so
Here´s one last excerpt from Buffett´s letter. He´s writing about all businesses, but a long-t
˜True, by buying and selling that is clever or lucky, investor A may take more than his share
It is now obvious I picked Google just to get your attention. Google may very well earn a retu
Even if it does grow at a phenomenal rate, it will, during the next half century, likely shed
I will attempt to provide some semblance of sobriety by letting Ovid express in three words wh
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The Wonders And Horrors Of Compounding
Word Count:
1665
Summary:
Google Price Target: $16,578.90
Some of you will immediately recognize this headline is a joke. For the rest of you, I was kin
If you´re reading this because you´re interested in what I have to say about Google (GOOG), yo
Warren Buffett´s annua...
Keywords:
compound growth, Warren Buffett, Buffett, Berkshire Hathaway, Berkshire, value investing, inve
Article Body:
Google Price Target: $16,578.90
Some of you will immediately recognize this headline is a joke. For the rest of you, I was kin
If you´re reading this because you´re interested in what I have to say about Google (GOOG), yo
Warren Buffett´s annual letter to shareholders was released on Saturday. For now, I´m just goi
ˆBetween December 31, 1899 and December 31, 1999, to give a really long-term example, the Dow
I knew what Warren was up to, and had some idea of the historical growth rate for the Dow, so
ˆHere´s the answer to the question posted at the beginning of this section: To get very specif
I wish I could tell you that my guess was close. But, it wasn´t even in the right ballpark. Th
The rallying cry of the bubble years would have been Dow 20,000. And what of Dow 10,000? The i
Over a century, that extra 0.7% really adds up. I recently wrote an email to a member of my fa
If you want to have more money than you will ever need, your best bet is to find a few places
It´s time to discuss Google. I have a price target of $16,578.90 on Google. Does that sound re
Don´t answer. First, we need to see what it would take for Google´s share price to reach $16,5
Who would want stock options in an average business? Let´s pretend no one would. Since there’s
As a public company, Google has earned an above average return on equity. It hasn´t been an ea
In my model, Google can literally conquer the world.
With something like $9 billion in equity to start with, a 12% return on equity, and the reinve
Don´t believe me? I know a 12% return on equity looks ridiculously low, but watch what happens
I mean profits! At a P/E of 15, Google would have a market cap of $4.68 trillion. Yes, with a
So, what´s the catch? There are two problems with this scenario. One, in 2056, it´s more likel
The second problem is much less amusing. You see, if on Monday, you were to shell out the $378
Google would have a $4.68 trillion empire, and you´d have an annual return of 7.85% - how can
Time turns molehills into mountains and mountains into molehills. In the very long-term, growt
However, it´s probably a smaller part than you think. Right now, Google is trading at about tw
Think of it this way. At $31.87 a share, 85% of your purchase price would be backed by cold, h
Return on equity is the puppet master here. Take another look at the numbers. They´re doing so
Here´s one last excerpt from Buffett´s letter. He´s writing about all businesses, but a long-t
˜True, by buying and selling that is clever or lucky, investor A may take more than his share
It is now obvious I picked Google just to get your attention. Google may very well earn a retu
Even if it does grow at a phenomenal rate, it will, during the next half century, likely shed
I will attempt to provide some semblance of sobriety by letting Ovid express in three words wh
TEMPUS EDAX RERUM
This is a demo version of txt2pdf v.10.1
Developed by SANFACE Software http://www.sanface.com/
Available at http://www.sanface.com/txt2pdf.html